Accounting Concepts and types of financial statements

1)You are looking at a financial statement. By studying the information on the statement, you can tell what the business owns (has) and what it owes as of a certain date. You are looking at a (an):
a)Income Statement
b)Statement of Owner's Equity.
c)Statement of Cash Flows.
d)Balance Sheet.

2)You own an Auto Repair business. For the month of June, 1997, the business charged its customers $4,000 and used supplies, equipment and labor for a total of $3,000. The business has:
a)suffered a loss of $1,000 for the month of June.
b)earned a profit of $1,000 for the month of June.
c)acquired a liability of $1,000 during the month of June.
d)acquired an asset of $1,000 during the month of June.

3) You are looking at a financial statement. By studying the information on the statement, you can tell what the business owed the owner at the beginning of the year, what profit or loss the business had for the year, what the owner invested during the year, what the owner withdrew from the business during the year and what the business owed the owner at the end of the year. You are looking at a (an):
a)Income Statement.
b)Statement of Owner's Equity.
c)Statement of Cash Flows.
d)Balance Sheet.

4)During the month of July, a business had Revenues of $8,000 and Expenses of $9,500. The owner did not invest any money or withdraw any money during July. The overall effect of this is:
a)the business owes outsiders $1,500 more than it did in June.
b)the business has $1,500 more in Assets than it did in June.
c)the business owes the owner $1,500 more than it did in June.
d)the business owes the owner $1,500 less than it did in June.

Solution Preview

1)d - A balance sheet is also called a Statement of Financial Position. It shows what a ...

Solution Summary

The solution provides a full sentence of explanation for each of the problems.